Operator: The next question is from Xueqing Zhang with CICC. Please go ahead.
Xueqing Zhang: Thanks management for taking my questions. My question is about standalone new applications. Should management share more color on these strategies and revenue expectations of new apps this year? Thanks.
Tang Yan: In 2022, ROI oriented new product turned profitable with revenues up nearly 150% from 2021. And our goal for this app this year is to further scale up revenue and profit. For the domestic apps, which are at a more mature stage, the user base is relatively stable at the moment. So, we will continue to expand profits by driving ARPPU and margins. And for the overseas apps, which are facing a much broader market space, our goal is to expand new revenue markets on top of deepening the existing territory. Turkish and Egyptian markets may be affected to some extent this year. But overall, we see strong revenue and profit growth opportunities for social apps in the mainland market. We will continue to make efforts in this direction.
In addition to the ROI oriented products that focus on revenue and profit, we will continue to invest and explore opportunities in DAU oriented products. And in fact, in addition to this year, we have several DAU oriented products in the pipeline currently in beta. We will share more information with the investor community as we accumulate our more data.
Operator: Yes. We have one more from Henry So with JPMorgan. Please go ahead.
Henry So: Thanks management for taking our question. My question is about margin. As you mentioned in the prepared remarks, optimizing costs will continue to be a key for this year. Could management share more color on the cost control strategy and the overall margin trend this year? Thanks.
Peng Hui: Sure, sure. Yes, that’s for me. For gross profit margin, the biggest driving force here is the payout ratio. I remember someone asked that question last quarter as well. Actually, probably every quarter, we all face this good old question. My answer remains pretty consistent with what I said at that time last quarter, which is that, the supply side factors are at this moment pretty stable. That means payout is going to remain largely stable as well, of course, different business of ours there are different margin profiles. So, revenue mix is always going to be another variable in the equation you should consider, when modeling out the GP margin. So that’s the GP margin line. Moving down that line, last year, we did a pretty good job in optimizing the key operating expenses items such as personnel expenses, marketing costs as well as infrastructure spending.
We just finished the annual budgeting cycle and it seems that, we still have some room to further improve the efficiency across all those spending areas. So we expect the operating expenses to further shrink down on a pretty — in a pretty meaningful way this year. And with top-line trend improving, as the year progresses, both bottom-line and bottom-line margins are going to improve as well. So, just, I’m trying to sort of put things into a nutshell, if you look at the top-line and the OpExtrends that I mentioned earlier, and try to think about how the math overall math works to this year. There are probably two key takeaways. One is that top-line wise 2023 is going to see continuous quarter-over-quarter improvement driven by the overall COVID recovery as well as the strong growth momentum coming from the smaller new applications.
And the second takeaway is that we’re going to continue to optimize our costs and expenses. So bottom-line is going to see pretty meaningful growth on a year-over-year basis, especially in the second half of the year. So that’s basically the overall financial picture that I can lay out at this point. I have visibility to layout at this point. For other stuff, I guess we’ll have to wait and see as the year progresses. I guess, for the interest of time, that’s going to be the last question that we take. I’ll hand back to Ashley for closing remarks.
Ashley Jing: Thank you everyone for participating our call and we’ll see you next quarter. Have a good night and good morning. Bye.
Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect.
